Canada’s Stelco to recall 175 workers after government pressure

Canadian steelmaker Stelco says it will recall all 175 workers laid off at its plant in Hamilton and pay them retroactively, following a weeks-long standoff that pitted workers and the Canadian government against its owner in the United States.

The announcement on Friday came shortly after Canada’s Industry Minister Melanie Joly said she would seek a court order to force Cleveland-Cliffs to sell Stelco unless she heard from management by the end of the day.

The company said in a statement on Friday that it had reached agreements with enough customers to restart its finishing operations and that workers would be recalled on December 1. They would receive back pay for the standard wages they would have earned while laid off.

The president of United Steelworkers Local 1005, Ron Wells, welcomed the announcement and credited pressure from workers, the union and the government.

At a news conference, he called the layoffs “illegal” and “immoral” which should never have happened.

Alongside him was Joly, who said the outcome sent a message to investors that Canada was “a country of the rule of law and that the law applies to everyone, notwithstanding the size of your wallet.”

Cleveland-Cliffs, which bought Stelco in 2024, announced in late September that up to 500 workers would be laid off at Stelco’s plants in Hamilton and Nanticoke, Ontario, citing weak demand and difficult market conditions for cold-rolled and coated steel products used to make everything from cars to appliances.

It blamed US President Donald Trump’s tariffs on Canadian steel, which made it more expensive in the US, as well as competition from cheaper foreign steel, which it argued was eating into domestic demand for Canadian steel.

Ottawa said the layoffs violated binding commitments the company made when it bought Stelco, including keeping the same number of Canadian unionised employees through 2029.

The government and the union also argued that Cleveland-Cliffs’ CEO Lourenco Goncalves violated a commitment to advocate for policies that would benefit the steel industries in both Canada and the US when he publicly supported Trump’s tariffs on steel, including Canada’s.

Goncalves’ open support for the tariffs raised questions, given that he also blamed them for Stelco’s financial troubles.

In its statement, Cleveland-Cliffs said its customers had committed to supporting its operations in Hamilton “despite the lack of response from the federal government to address the shortfalls in their tariff response program.”

It didn’t provide details on the agreements it had reached with customers or explain what had changed to make restarting operations viable.